Going, Going, Gone...Through The Roof!: Cigar Prices At Auction

Perhaps today's multimillion-dollar cigar auction world would never have come to exist, if it hadn't been for arch anticapitalist Fidel Castro.

After all, it was Castro's overthrowing of US-backed dictator Juan Batista, followed by his "nationalization" of lands previously owned by such American companies as United Fruit, that pushed John F. Kennedy into enacting a trade embargo against Cuba - or, to be more precise, using an executive order to extend the temporary embargo begun under predecessor Dwight Eisenhower. (This despite Castro's offer to recompense the offended companies at interest rates based on the tax-declared value of the lands, which values everyone knew were bogus, designed to favor the companies at Cuba's expense.)

So America swung into action, preventing the importation of Cuban products including, of course, Cuban cigars. Among the many historical ironies attending this long, seemingly-unsuccessful law (its declared purpose was to weaken Castro, now one of the world's most enduring dictators) is that two Presidents involved in its survival - John F. Kennedy and Bill Clinton (under whom it was made federal law, and who expanded it in 1999) - were both cigar smokers. (Kennedy aide Pierre Salinger later recalled being ordered by the President to purchase thousands of boxes of Cubans immediately before the embargo, so the nation's chief executive wouldn't have to go cold turkey.)

What's the connection between Cuba, cigars and the growth of cigar auctions during the past twenty years? Well, the practice of auctioning cigars began, as Cigar Aficionado contributor Brendan Vaughan writes, with Cubans, which began to be sold on a now-and-then basis by legendary British auction house Christie's, at their regular London wine sales.

Now, Britain doesn't have a trade embargo with Cuba; you can buy Cuban cigars at any English cigar store. What you can't necessarily do is to buy well-aged Cubans. As Vaughan puts it, For "roughly the same price as a box of year-old Cohiba Esplendidos from the cigar store, you could buy a box of five-year-old Cohiba Esplendidos at auction." The number of highly experienced, discriminating, sensitive cigar buyers to whom such a distinction would matter is always small - "maybe 10 regular buyers," wrote Vaughan - but to them, it would matter enormously.

So, just as the "cigar boom" of the mid-1990s was helped along in part by wine-and-beer stores - renewed interest in stocking cigars, the boom in cigar auctions began at wine sales. But this other, parallel boom was also helped along by the foundering of the Cuban economy in the post-Soviet world, as Cuba's great cigar factories shipped younger cigars. Suddenly those auctioned-off boxes of aged Cuban cigars began to look like pretty bargains indeed.

Pre-embargo cigars (the only kind on which Americans could legally bid) escalated in price, going in some cases for over $2500, and this market outlook in turn encouraged some longtime cigar collectors to loosen their grip on their prize smokes. The number of cigars available at auction grew alongside the prices these boxes might fetch.

History - at least, cigar lovers history - was made. Three times during one six-month 1997 period, the record for highest price fetched by cigars at commercial auction was exceeded. (The culminating number: nearly $25,000 for a box of Havana 1492s, the limited-edition cigar made to culminate the 500th anniversary of Columbus's non-discovery of the Americas. With fifty to a box, that's an average of $495 per cigar. One almost hopes they were never smoked, at that price.)

The cigar boom of the 1990s, like the mid-70s "Latin American boom" in literature or, closer to home, the 1995-2000 tech boom that may in part have helped subsidize the cigar boom, eventually wound down, but not without making cigar smoking once again a fixture of American life, one that does not seem likely to disappear anytime soon. The same can be said of the cigar-auction boom - things have calmed down without fading away. Christie's began holding cigar-only auctions in May 1999, and extended this practice to its New York auction house in December of that year.

What's the result? Well, that 1997 record still stands, but ten years later, at the 2007 London Christie's cigar auction, a box of La Flor de Cano Short Churchills reached a price of $451 per, while a humidor of 96 Hoyo de Monterrey Diademas fetched $16,400.
Meanwhile, topping things off, a Che Guevara tribute-humidor sold for $8200. Ernesto Che Guevara, you may remember, was Castro's right-hand-man during the Cuban revolution, renamed for his habit of calling everyone Che ("buddy"). There's that pesky Castro again!